BUSINESS leaders in Coventry have reacted strongly to a European Court ruling to extend the right to annual paid leave to short-term contract workers.

The ruling, following a case brought against the Government, will extend the entitlement of four weeks' annual leave to all workers from their first day of employment.

But Coventry business chiefs warned it could cause major problems for companies employing short-term contract workers.

David Frost, pictured, chief executive of Coventry and Warwickshire Chamber, said: "It is going to be a problem for every business that employs working parents.

"With four weeks parental leave, two weeks paid paternity leave and extended maternity leave for up to one year, in addition to four weeks paid annual leave, all employers in all sectors will increasingly need to employ workers to manage absences.

"They will now find themselves in the ridiculous situation of paying for a short-term contract worker for one or two months to cover for a working parent and having to find temporary staff to cover the short-term contract worker who could be due one to three days paid leave.

"The Government has been trying to demonstrate to employers that it will help small firms to manage absences through advice and Employment Service support in accordance with proposals in the Work and Parents Green Paper.

"This ruling will only make managing absences even harder for small firms."